The European Parliament voted on Tuesday to increase macro-financial assistance to the Republic of Moldova to 145 million euros to help the country cover part of its financial needs in 2023, Agerpres reports.

Deputies of the European Parliament approved the proposal of the European Commission to provide the government of the Republic of Moldova with support to stabilize the economic situation in the country with 561 votes “for”, 43 “against” and 20 abstentions.

Support totaling EUR 45 million in grants and up to EUR 100 million in loans will be disbursed in two tranches scheduled for the third and fourth quarters of 2023, subject to certain conditions being met by the Republic of Moldova.

Among them are reforms of the judicial system, ensuring the rule of law and fighting corruption, as well as satisfactory progress in the implementation of the macroeconomic program of the International Monetary Fund (IMF).

Economic problems facing Maya Sandu’s government

As a result of Russia’s invasion of Ukraine, the economy of the Republic of Moldova collapsed, and the uncertain economic climate negatively affected investments and trade in the country.

The energy crisis and the decrease in household consumption and investment have created additional pressure on the public finances of the Republic of Moldova. In addition, a sudden increase in energy prices creates a high level of inflation.

“The Russian-aggressor war in Ukraine spared no one, and even less so the Republic of Moldova. An unfortunate combination of war, energy crisis, huge inflation and a drop in household consumption and investment has undermined public finances and affected the livelihoods of Moldovan citizens,” said speaker Marketa Gregorova from the Greens/European Free Alliance (Verdi/ALE) group, quoted in the press release. EP release.

“In addition to all this, the growing influence of Russia in this region puts additional pressure on the economy of the Republic of Moldova. In these difficult times of economic and political vulnerability, we must help and support the Republic of Moldova,” she added.

The Republic of Moldova benefits from the current macro-financial assistance, which entered into force on July 18, 2022. Once the support is approved by the EU Council, it will be published in the Official Journal of the EU and will apply the day after the date of publication.

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